Dubai Boom Goes On Regardless

18 Dec 2012

Even as Dubai building boom is continuing with massive plans on the drawing board, lending banks are wary this time round that the euphoria maybe misplaced after all. The Emirate, however, does not think so.

Once bit in 2008, when the recession round the world hit Dubai constructions also, the bankers may not finance the upcoming projects, including the proposed city named after Dubai Sheikh, Mohammed Bin Al Maktoum, new world's biggest mall and replica of the Tajmahal that will be four times bigger than the original.

The previous construction loans having gone bad leading to a debt crisis, the bankers are in no mood to back Dubai's massive construction plans. Moody's in fact downgraded Dubai's biggest banks as recently as December 7, saying the banks had not done enough on bad loans that have piled up.

However, cocking a snook at the bankers, the Dubai builders are going on their own, hoping to raise resources themselves. Emaar properties, which has been behind the building boom and is planning MBR City named after the Dubai Sheikh, is going on regardless with its plans on its strength of changing gear midway the previous time and going for retail, thus raising regular returns.

Besides, considering the proposed city being a prestigious project named after the Dubai Sheikh himself, Emaar Properties is as at present going it alone (along with native financiers) but keeping the cards close to its chest.  Not only that, the debt crisis in Dubai was partially set off by Abu Dhabi last time. So the Gulf states can be expected to to bail out each other and go ahead with their upward mobile plans, one way or the other.